Microsoft ready to bid again for Yahoo if board is replaced
Tuesday 08 July 2008
Shares in Yahoo soared yesterday after Microsoft said it would reconsider a takeover bid for the company if the search engine specialist's board is replaced.
Microsoft and Yahoo were unable to agree takeover terms earlier this year.
The billionaire US activist Carl Icahn is trying to replace Yahoo's board at the group's annual meeting next month.
The world's largest software company sought to acquire Yahoo to fight back against the search engine market leader Google.
Yahoo's shares closed up 12 per cent at $23.91 in New York last night. In a letter to Yahoo shareholders yesterday, Mr Icahn said he had held several lengthy conversations with Microsoft's chief executive, Steve Ballmer, over the past week. Mr Icahn said: "Steve made it abundantly clear that, due to his experiences with Yahoo during the past several months, he cannot negotiate any transaction with the current board."
Yahoo rejected a $33 a share offer from Microsoft as undervaluing the firm.
In a statement, Microsoft said it "cannot reach an agreement " with the current Yahoo board, led by Jerry Yang, but added: "We confirm, however, that after the shareholder election Microsoft would be interested in discussing with a new board a major transaction with Yahoo, such as either a transaction to purchase the 'search' function with large financial guarantees or... purchasing the whole company."
Yahoo said that its independent directors and management approached Mr Ballmer about an acquisition in June, but he was no longer interested even in the price range which they had previously proposed.
In a statement, Yahoo urged Mr Ballmer to make a "proposal immediately" and said it was keen to hear if Mr Icahn has an actual plan beyond hoping that Microsoft will do a deal.
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